Free calculator · US & UK
Should I refinance? The break-even calculator
The short answer: refinancing pays when the monthly saving covers the closing costs before you would next move or remortgage, on the same remaining term. This tool computes that break-even month precisely and refuses the oldest trick in the business, resetting the clock and calling it a saving.
This tool keeps the same remaining term on both sides. Extending back to 30 years lowers the payment by adding years of interest, which is a loan, not a saving.
US refinances typically run 2 to 5% of the balance; UK remortgages are cheaper but arrangement fees and legal costs count. Fees rolled into the loan still cost you, plus interest.
The decision rule: if the break-even lands inside the time you will realistically keep this loan (people move and refinance more often than they expect; the US median is well under a decade), the refinance pays. If it does not, the lower payment is just a fee with better marketing. A rough rate-of-thumb, that a refinance needs 0.5 to 1 point of rate improvement to clear its own costs, falls out of exactly this math.
Payment, break-even and lifetime numbers, saved.
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Educational information, not financial advice. Figures current as of July 2026 where dated; allowances and rates change, so check the source before acting.